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Oakland's Biggest Landlord is Fighting For His Life in Federal Court

Fed-up tenants now rebelling against him, too, and looking for the city for help.

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After three months of no response from Community Realty, Allen said she called Oakland's building department and had inspectors come out. The inspectors cited Marr's company for the code violations, according to city records. Afterward, Community Realty fixed the window.

Attorney Larsen argued that his client is a good landlord who provides affordable rental housing for Oakland residents, and that Marr's company tries its best to address every issue reported by tenants.

"I know he's never denied anyone a repair," Larsen said in response to allegations.

Allen said Community Realty responded to the window incident by filing an eviction lawsuit against her. It alleged that she hadn't paid her rent. Allen said she obtained a copy of her rental payment and showed it to Community Realty, and they subsequently withdrew the eviction lawsuit.

But then they filed another, she said.

She says there has been a pattern of her rental payments going "missing" in Community Realty's offices. This forced her to check court records on a weekly basis, to make sure her landlord wasn't filing new eviction lawsuits against her — which she would only have five days to respond to or risk being thrown out of her home.

She suspects her landlord wants her to move out. "I'm paying $1,440, but I'm sure they could get $2,300 in the current market," Allen said. "But it's rent controlled."

"As you know, there's two sides to every story," was Larsen's response to Allen's case.

According to Larsen, "Allen had a long history of paying rent late." Larsen said she never provided proof that her rent payments were lost by Community Realty.

This past December, Allen sat in the back of a downtown Oakland federal courtroom and watched as U.S. Justice Department prosecutors squared off against Marr's attorneys in a preliminary hearing. Allen listened attentively as the attorneys argued about how soon Marr's trial should commence, and how both sides will use a custom database to organize millions of pages of documents, which the feds say proves the bid-rigging conspiracy. After the hearing, Allen and a few organizers with the housing-rights group Alliance of Californians for Community Empowerment stood in the courthouse lobby, not far from where Marr and his attorneys huddled. She told the ACCE organizers that she thinks the City of Oakland, or another authority, should take a close look at how Marr is managing his rental properties.

In October of last year, Allen also wrote Schaaf and Parker requesting that the city look into the conditions of Marr's rental properties and take action if warranted. "I have been greeted with multiple eviction proceedings in retaliation for asking for repairs," Allen wrote.

"Please stop ignoring the problem and passing responsibility around."

Alex Katz, a spokesman for Parker, wrote in an email that the city has met with some of Marr's tenants about allegations of substandard living conditions and other problems. "We are looking into the complaints," Katz wrote.

Conspiracy or friendly joint-business venture?

The issue of whether or not Marr is a good or a bad landlord could be a moot point by the end of the year: The fate of his real-estate empire depends on the outcome of the federal government's antitrust case against him.

He has been charged with one count of bid-rigging, which carries a sentence of up to ten years in prison and a fine of $1 million. He's also been charged with six counts of mail fraud. Each charge carries 20 more years and another million-dollar fine.

But Martha Boersch, Marr's attorney in the federal lawsuit, called the government's case weak.

"He's innocent, and so are the other defendants," Boersch said, referring to Javier Sanchez, Gregory Casorso and Victor Marr, three of Marr's business associates who are standing trial alongside him. "They were simply doing what people have done in America for hundreds of years: buying property and sometimes reselling it. There was no bid-rigging at these markets."

In a motion filed with the federal court in March, Boersch argued that FBI investigators may have found evidence that Marr and others made joint bids and cooperated in other ways at foreclosure auctions. But prosecutors have incorrectly characterized this as "rigging" the auction to suppress competition. By teaming up, she contends that Marr and others actually made the foreclosure auctions more competitive.

"[J]oint bidding can be pro-competitive by allowing individual bidders to pool their resources, efforts, knowledge, or appetite for risk, to make acquisitions together that they could not or would not make independently," wrote Boersch, and several other attorneys, in a court motion. "If anything, their 'secondary auctions' performed like an efficiency-enhancing buying collective that actually encouraged competition."

According to Boersch, the real-estate auctions during the foreclosure crisis were "completely dominated" by Wall Street. "The banks controlled every aspect of the foreclosure auctions in Alameda and Contra Costa counties," she explained to the court. The banks set the minimum-bid prices, but declined to offer bidders like Marr any relevant information regarding the physical condition of properties, whether they were occupied by former owners or tenants, or other crucial factors that would affect the price.

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